Nokia X2: why is Microsoft making an Android phone?

Rumors of the next-generation Nokia X began popping up just a few weeks ago, when the name and a different swath of specifications popped up in a benchmarking application. Unlike the Nokia X, X+, or XL, all announced at Mobile World Congress, the Nokia X2 was rumored to come with slight improvements across the board – a 1.2GHz dual-core Snapdragon 200 SoC, 1GB RAM, and 4GB storage.

The rumors were met with a lot of skepticism, though. Some thought it was too soon for yet another Nokia X phone. Others felt Microsoft would can the Android projects as soon as the acquisition completed. The rest felt the improvements were just too slim to justify a whole new hardware release. Every argument against the Nokia X2 happening made perfect sense.

Early this morning, however, Microsoft and Nokia surprised us all by making the Nokia X2 official. The rumors were spot-on; the X2 has been upgraded to the Snapdragon 200, 1GB RAM, 4GB inbuilt storage, 5-megapixel rear camera with flash, 4.3-inch WVGA ClearBlack LCD, a 1,800mAh battery, and dual-SIM compatibility. Of course, also in tow is Nokia’s heavily customized strain of Android.

The ultimate question is, why? Why does the Nokia X2 exist and why is it running a diluted version of Android rather than fully-fledged Windows Phone?

Many speculated the Nokia X would be the first and last Nokia-made Android phone. Once Microsoft’s acquisition of Nokia Devices and Services completed in April, many thought that would be the abrupt end of Nokia’s side project.

For one, Microsoft didn’t appear to be thrilled by the idea of Nokia building phones which ran the software of its biggest mobile competitor. Following the Nokia X announcement, Microsoft wasn’t shy about being displeased with Nokia’s decision to launch a family of Android-powered smartphones. When asked about the Nokia X phones, Microsoft’s Joe Belfiore told Business Insider, “They’ll do some things we’re excited about, and some things we’re less excited about.”

And there’s a third and final reason no one thought the Nokia X project would stay alive. Performance. I don’t know sales figures, and frankly, I don’t care. I’m talking day to day performance. Nokia X shipped with Android 4.1 on dated, low-end hardware. It wasn’t optimized, and from what I’ve read and seen, the experience wasn’t nearly as impressive as other devices with comparable specifications or price points.

It was, at best, a half-hearted attempt from Nokia. The execution was poor and it reflected poorly on all the great things Nokia has done in recent years. In other words, all the low-end Nokia smartphones were better implementations – better build quality and design, better optimization, and better value.

The one way Microsoft could benefit from in-house Android smartphones is by piggybacking on Android’s broad application support and feeding off the ambiguity created by Nokia’s custom Android interface which, once again, bears a stronger resemblance to Windows Phone than run-of-the-mill Android.

This time around, the Nokia Store supports third-party app stores, meaning Nokia’s limited Android app offering just expanded by a fair amount, especially if you consider the Amazon Appstore. That, paired with side loading, Nokia X2 users should have access to practically any and all Android applications, so long as they don’t require Google services.

Launching a phone like the Nokia X2 in an emerging market with an irresistible price point makes a good bit of sense. And I figure Microsoft sees an opportunity to boost its market share, even if that means through another mobile platform. Rope buyers in using Android’s application support, make them comfortable with the UI, the brand, and Microsoft services, and pull the rug out from beneath them, only to launch similar, Windows Phone-powered hardware shortly thereafter.

That’s an awfully devious plan, and it’s highly unlikely that Microsoft has resorted to such guerrilla tactics. Or is it?

Nokia called the Nokia X a “feeder” phone back at launch. Neil Broadly told TechCrunch, “The Nokia X family… acts as the perfect feeder to our Lumia high-end smartphone family, which is very much our premium and our flagship family.” Microsoft appears to be building on that idea by heavily pushing its cloud services alongside the Nokia X2. The phone comes preloaded with Skype, Outlook, OneDrive with 15GB storage, OneNote, Bing Search, Yammer, and Xbox Games.

If Microsoft can convert users in emerging markets over to Windows Phone or it’s in-house cloud services, it’s a win for the company, so long as it can actually move units. At that price, I imagine it won’t be too difficult. Then again, running old, poorly-optimized Android software on underpowered hardware may not be the most convincing sales pitch for uneducated users to switch to Microsoft’s visually similar operating system.

What say you, folks? Why has Microsoft decided to keep its Android lineup alive? For sheer market share? To eventually bait-and-switch buyers into its own ecosystem? Or is Microsoft doing it just to see what happens?

Based out of Charlotte, NC, Taylor Martin started writing about technology in 2009 while working in wireless retail. He has used BlackBerry off and on for over seven years, Android for nearly four years, iOS for three years, and has experimented with both webOS and Windows Phone. Taylor has reviewed countless smartphones and tablets, and doesn't go anywhere without a couple gadgets in his pockets or "nerd bag." In his free time, Taylor enjoys playing disc golf with friends, rock climbing, and playing video games. He also enjoys the occasional hockey game, and would do unspeakable things for some salmon nigiri. For more on Taylor Martin, checkout his Pocketnow Insider edition.| Google+